Q.1
Pam considers t-shirts and gym classes to be complementary goods.How will Pam react if the price of gym classes increase?
  • Her quantity demanded of gym classes will increase, and her demand for t-shirts will increase.
  • Her quantity demanded of gym classes will increase, and her demand for t-shirts will decrease.
  • Her quantity demanded of gym classes will decrease, and her demand for t-shirts will be unaffected.
  • Her quantity demanded of gym classes will decrease, and her demand for t-shirts will decrease.
Q.2
What type of good can be summed up with the following statement: If you had an increase in income you would not own this car.
  • inferior good
  • complement good
  • substitute good
  • normal good
Q.3
If income increases, what will happen to the demand curve for an inferior good?
  • shift to the left
  • shift to the right
  • stay the same
  • move down
Q.4
If income increases, what best describes normal goods?
  • at any price there will be an increase to demand
  • only at low prices there will be an increase to demand
  • only at higher prices there will be an increase to demand
  • there will be no change
Q.5
What happens to the demand curve when people expect the future price to lower and people wait to buy?
  • it stays the same
  • it shifts right
  • it shifts left
  • it moves up
Q.6
What happens to the demand curve when people expect future prices to increase and people buy now rather than later?
  • it stays the same
  • shifts to the left
  • shift to the right
  • moves up
Q.7
Economists have observed that when average incomes increase, purchases of fast food tends to decline.Based on this information, what can we definitely say about fast food?
  • Fast food has no substitutes
  • Demand for fast food is upward sloping
  • The price of a complement to fast food has risen
  • Fast food is an inferior good
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